Slide 1: Fiscal Year 2016 Third Quarter Conference Call
Fiscal Year 2016 Third Quarter Conference Call July 27, 2016 Rev 5058-CO900A Copyright © 2016 Rockwell Automation, Inc. All rights reserved.
Slide 2: Safe Harbor Statement
Safe Harbor Statement ▪ This presentation includes statements related to the expected future results of the company and are therefore forward-looking statements. Actual results may differ materially from those projections due to a wide range of risks and uncertainties, including those that are liste
Slide 3: Fiscal 2016 Third Quarter Summary
Fiscal 2016 Third Quarter Summary ▪ Organic sales down 4.8% YOY ▪ Sequential improvement in product sales and solutions and services orders ▪ U.S. and Canada solutions and services businesses below expectations ▪ Weak heavy industry end markets; growth in consumer and automotive ▪ Strong performance
Slide 4: Key Financial Information: Third Quarter
Key Financial Information: Third Quarter (in millions, except per share amounts) Q3 2016 Q3 2015 YOY B/(W) Sales $ 1,474 $ 1,575 (6.4)% Segment Operating Margin 21.1% 21.8% (70) bps General Corporate - Net $ 17 $ 22 $ 5 Adjusted EPS $ 1.55 $ 1.59 (2.5)% Adjusted Effective Tax Rate 25.1% 27.9% 280 bp
Slide 5: Architecture & Software
Architecture & Software Sales Segment Operating Margin ($ millions) $2,500 35% $2,066 29.2% 30.1% $1,939 30% 27.6% 26.6% $2,000 25% $1,500 20% $1,000 15% $684 $666 10% $500 5% $0 0% Q3 YTD Q3 YTD 2015 2016 2015 2016 YOY Sales % Change ▪ Segment operating margin contracted Q3 2016 YTD 160 bps in Q3,
Slide 6: Control Products & Solutions
Control Products & Solutions Sales Segment Operating Margin ($ millions) $3,000 20% $2,635 $2,500 $2,402 16.1% 15.7% 15.3% 15.4% 15% $2,000 $1,500 10% $1,000 $892 $808 5% $500 $0 0% Q3 YTD Q3 YTD 2015 2016 2015 2016 YOY Sales % Change ▪ Segment operating margin contracted 40 Q3 2016 YTD bps in Q3, p
Slide 7: Regional Sales
Regional Sales (in millions, except percentages) Q3 2016 YTD Organic Organic Region Sales % Change Sales % Change Third Quarter * ▪ U.S. and Canada decline U.S. $ 800 (8.4)% $ 2,392 (7.0)% driven by heavy industries Canada 82 (7.5)% 237 (5.9)% ▪ Solid growth in EMEA driven largely by strength with O
Slide 8: Revised Fiscal 2016 Guidance
Revised Fiscal 2016 Guidance July Guidance April Guidance Sales Midpoint ~ $5.85B ~ $5.9B Organic Growth Range ~ (4)% (4.5)% to (1.5)% Currency Translation ~ (3)% ~ (3)% Segment Operating Margin ~ 20.5% ~ 20.5% Adjusted Effective Tax Rate ~ 24.5% ~ 25% Adjusted EPS $5.80 - $6.00 $5.75 - $6.15 Free C
Slide 9: Supplemental Financial Information and Reconciliations to Non-GAAP Measures
Appendix Supplemental Financial Information and Reconciliations to Non-GAAP Measures Copyright Copyright ©© 2014 2014 Rockwell Rockwell Automation, Automation, Inc. Inc. All All rights rights reserved. reserved.
Slide 10: Third Quarter Results: Summary
Third Quarter Results: Summary (in millions, except per share amounts) Q3 2016 Q3 2015 Total Sales $ 1,474.0 $ 1,575.2 Total Segment Operating Earnings $ 311.0 $ 343.7 Purchase Accounting Depreciation and Amortization (4.7) (5.2) General Corporate - Net (17.0) (21.9) Non-Operating Pension Costs (18.
Slide 11: Free Cash Flow
Free Cash Flow (in millions) Q3 2016 YTD Net Income $ 191.0 $ 544.5 Depreciation/Amortization 42.8 129.2 Retirement Benefits Expense 39.3 117.5 Receivables/Inventory/Payables 39.1 22.1 Compensation and Benefits (7.4) (81.1) Pension Contributions (10.6) (31.8) Income Taxes 3.2 (54.8) Other (21.4) 29.
Slide 12: Reconciliation to Non-GAAP Measures: Organic Sales by Region
Reconciliation to Non-GAAP Measures Organic Sales (in millions, except percentages) Three Months Ended June 30, 2016 2015 Sales Sales Organic Effect of Excluding Growth Growth Changes in Changes in Effect of Organic (Decline) (Decline) Sales(a) Currency Currency Acquisitions Sales(b) Sales(c) (a)/(c
Slide 13: Reconciliation to Non-GAAP Measures: Organic Sales by Segment
Reconciliation to Non-GAAP Measures Organic Sales (in millions, except percentages) Three Months Ended June 30, 2016 2015 Sales Sales Organic Effect of Excluding Growth Growth Changes in Changes in Effect of Organic (Decline) (Decline) Sales(a) Currency Currency Acquisitions Sales(b) Sales(c) (a)/(c
Slide 14: Reconciliation to Non-GAAP Measures: Segment Operating Margin
Reconciliation to Non-GAAP Measures Segment Operating Margin (in millions, except percentages) Three Months Ended Three Months Ended Nine Months Ended Nine Months Ended June 30, 2016 June 30, 2015 June 30, 2016 June 30, 2015 Sales Architecture & Software (a) $ 666.4 $ 683.5 $ 1,938.8 $ 2,065.6 Contr
Slide 15: Reconciliation to Non-GAAP Measures: Adjusted Income, EPS and Tax Rate
Reconciliation to Non-GAAP Measures Adjusted Income, Adjusted EPS and Adjusted Effective Tax Rate (in millions, except per share amounts) Three Months Ended Three Months Ended Nine Months Ended Nine Months Ended June 30, 2016 June 30, 2015 June 30, 2016 June 30, 2015 Income from continuing operation
Slide 16: Reconciliation to Non-GAAP Measures: Return On Invested Capital
Reconciliation to Non-GAAP Measures Return On Invested Capital (in millions, except percentages) Twelve Months Ended June 30, 2016 2015 (a) Return Income from continuing operations $ 745.8 $ 875.0 Interest expense 69.8 62.0 Income tax provision 239.3 312.6 Purchase accounting depreciation and amorti
Slide 17: Reconciliation to Non-GAAP Measures: Fiscal 2016 Guidance
Reconciliation to Non-GAAP Measures Fiscal 2016 Guidance (in billions, except percentages and per share amounts) Organic Sales July Guidance April Guidance Organic sales growth ~ (4)% (4.5)% to (1.5)% Foreign currency impact ~ (3)% ~ (3)% Acquisition impact ~ 0% ~ 0% GAAP sales growth ~ (7)% (7.5)%